John Deaton, the pro-crypto Republican candidate vying to win Senator Elizabeth Warren’s current senate seat, took to X on Monday (formerly Twitter) to blast United States Securities and Exchange Commission (SEC) chair Gary Gensler over the new Coinbase appeal, calling him a “bad faith regulator.”
John Deaton Slams Gary Gensler Over Coinbase Appeal
In his X post, Deaton criticized Gensler for the SEC’s regulation-by-enforcement approach after Coinbase filed an interlocutory appeal in federal court due to the agency seeking clarification over whether digital assets qualify as investment contracts (securities).
“Because Congress is inept and because @GaryGensler is a bad faith regulator pursuing a political agenda, Coinbase is hoping to achieve regulatory clarity through the judicial system,” Deaton wrote before seemingly ironically pointing out that the “checks and balances form of government is one example of what separates America from many other nations.”
On Friday, @coinbase filed a request for permission to file an interlocutory appeal to the 2nd Circuit Court of Appeals. Because Congress is inept and because @GaryGensler is a bad faith regulator pursuing a political agenda, Coinbase is hoping to achieve regulatory clarity… https://t.co/Udv2swSdjz
— John E Deaton (@JohnEDeaton1) April 15, 2024
The SEC originally sued Coinbase in June 2023 for allegedly violating U.S. securities laws by operating as an unregistered crypto trading platform.
The crypto exchange attempted to dismiss the commission’s case against it, however, U.S. District Judge Katherine Polk Failla denied Coinbase’s motion to do so just last month.
“@GaryGensler and the SEC have demonstrated that they are not interested in protecting small investors and operate only to serve their political masters,” Deaton continued. “Coinbase and its lawyers must serve the interests of employees and shareholders. The customers, who don’t own shares in $COIN, deserve a voice. I will continue to be that voice.”
The SEC Is Fueling Fear In Crypto Community, Commissioner Says
The digital asset community has long reproached the SEC for its enforcement-focused approach to crypto regulation, filing lawsuits against key industry players, including Ripple, Binance, and others.
Earlier this month, SEC Commissioner Hester Pierce criticized her own agency during the Practicing Law Institute’s annual “SEC Speaks” event for its supposed mistreatment of the digital asset sector, claiming its heavy-handed approach to regulation is “scaring people off.”
“The Commission’s announcement of a large ramp-up in its cyber-and crypto-enforcement unit, repeated assertions that the crypto industry is lawless, and treatment of cyber-incidents as fertile ground for enforcement actions add to these fears,” Pierce said.
The SEC and Coinbase were widely reported to be heading to trial this spring over the litigation. The crypto platform’s recent appeal may be a crucial turning point while slowing the legal battle entirely.
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